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EET/S3/10/2/A ECONOMY, ENERGY and TOURISM COMMITTEE AGENDA 2Nd Meeting, 2010

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EET/S3/10/2/A ECONOMY, ENERGY and TOURISM COMMITTEE AGENDA 2Nd Meeting, 2010 EET/S3/10/2/A ECONOMY, ENERGY AND TOURISM COMMITTEE AGENDA 2nd Meeting, 2010 (Session 3) Wednesday 13 January 2010 The Committee will meet at 9.30 am in Committee Room 5. 1. Beauly to Denny Power Line: The Committee will take evidence from— Jim Mather, Minister for Enterprise, Energy and Tourism, Colin Imrie, Deputy Director Energy Markets, Simon Coote, Senior Policy Officer, Deployment and Consents Division, and Stephen Wilson, Consents Case Officer, Deployment and Consents Division, Scottish Government. 2. Energy Bill (UK Parliament legislation): The Committee will take evidence on legislative consent memorandum LCM(S3) 12.3 from— Jim Mather, Minister for Enterprise, Energy and Tourism, and David Rennie, Branch Head, Fossil Fuels and Carbon Capture and Storage Development Team, Scottish Government. 3. Energy Bill (UK Parliament legislation): The Committee will consider the legislative consent memorandum lodged by John Swinney MSP (Cabinet Secretary for Finance and Sustainable Growth) (LCM(S3) 12.3). 4. Constitutional Reform and Governance Bill (UK Parliament legislation): The Committee will take evidence on legislative consent memorandum LCM(S3) 23.1 from— Jim Mather, Minister for Enterprise, Energy and Tourism, Margret Coutts, Head of Corporate Learning, Corporate Lerning Services, Lesley Bagha, Solicitor, Solicitors Employment and Litigation Division (EL), and Fraser Gough, Solicitor, Solicitors Employment and Litigation Division (EL), Scottish Government. 5. Constitutional Reform and Governance Bill (UK Parliament legislation): The Committee will consider the legislative consent memorandum lodged by John Swinney MSP (Cabinet Secretary for Finance and Sustainable Growth (LCM(S3) 23.1). EET/S3/10/2/A Not before 10:45 AM 6. The way forward for Scotland’s banking, building society and financial services sector: The Committee will take evidence from— David Nish, Group Chief Executive, Standard Life; and then from— Maggie Craig, Acting Director General, Association of British Insurers. Stephen Imrie Clerk to the Economy, Energy and Tourism Committee Room T3.40 The Scottish Parliament Edinburgh Tel: 0131 348 5207 Email: [email protected] EET/S3/10/2/A The papers for this meeting are as follows— Agenda item 1 Beauly to Denny power line EET/S3/10/2/1 Agenda item 2 Note by the clerk EET/S3/10/2/2 Agenda item 4 Note by the clerk EET/S3/10/2/3 Agenda item 6 Note by the clerk EET/S3/10/2/4 Note by the clerk EET/S3/10/2/5 (P) EET/S3/10/2/2 ECONOMY, ENERGY AND TOURISM COMMITTEE 2nd Meeting, 2010, Session 3, Wednesday, 13 January 2010 ENERGY BILL (UK PARLIAMENT LEGISLATION) – LEGISLATIVE CONSENT MEMORANDUM Background 1. The UK Energy Bill was introduced in the House of Commons on 19 November, 2009. The Bill introduces a financial incentive, funded by electricity suppliers, to support up to four Carbon Capture and Storage (CCS) commercial scale demonstration projects. It is expected that the CCS incentive will be able to provide financial support for future retrofit as well. 2. As a result of recent amendments lodged by the UK Government during the passage of the Bill, it is now subject to a supplementary LCM (LCM(S3) 12.3), which has been lodged by the Scottish Government. These amendments make provisions that relate to matters within the legislative competence of the Scottish Parliament and/or alter the executive competence of the Scottish Ministers. A copy of the supplementary LCM is attached at annexe A. 3. The Parliamentary Bureau referred the LCM to the Economy, Energy and Tourism Committee to consider and report on. The Committee must consider the LCM and make a report on its views to the Parliament no later than five sitting days before the Parliament shall consider the legislative consent motion. It is the clerks understanding that to meet the UK Government’s timetable associated with the Bill, the Committee report will have to be published as early as 14 January 2010. Provisions Relating to Scotland 4. The Bill will enable the UK Government to raise a UK-wide levy (which is a reserved matter) on electricity supply to be charged in connection with provision of financial assistance in respect of CCS demonstration projects. The Bill will also include an explicit reference stating that for major projects situated in Scotland, the Secretary of State must consult with Scottish Ministers before making, amending or revoking an assistance scheme and before making regulations relating to assistance schemes. 5. There are further provisions in the Bill which ensure that the Secretary of State gets the consent of Scottish Ministers before making Regulations under part 1 of the Bill, which amend or contain provision extending to Scotland. This is a similar approach taken in the Energy Act 2008. 6. The disbursal of the CCS financial incentive funds in Scotland would fall within devolved competence. The Scottish Government feels that an allocation approach is unlikely to be the best option for supporting projects. Given the significant cost of each demonstration project, it would pursue funding on an individual basis. 1 EET/S3/10/2/2 7. The Scottish Government announced on 9 November its position on coal fired power stations, which aligns with the UK position. All new coal plant are now required to demonstrate CCS on 300MW (net) on start up and from 2020 all new coal plant must be fully CCS compliant. In addition to this, if CCS is considered technically and financially viable by 2018 it is likely that retro-fitting of all existing plant would be required by 2025. 8. By way of an update, a letter from the Minister for Enterprise, Energy and Tourism to the Convener is attached at annexe B. Action and Decision 9. There is no formal model to be followed in terms of the Committee’s consideration or report on the LCM to this Bill. However, the Committee may wish to consider the following areas in its scrutiny of the LCM and in taking evidence from the Minister for Enterprise, Energy and Tourism— • the general merits of the relevant provisions contained within the Bill that are identified within the Legislative Consent Memorandum; • whether the relevant provisions in the Bill justify the need for a Legislative Consent Memorandum; • whether the Committee has any comments on the draft legislative consent motion contained within the LCM. 10. The Committee is invited to decide whether it wishes to recommend, in a report to the Scottish Parliament, that consent be granted to the UK Parliament to consider the Bill as set out in the draft Legislative Consent motion. 11. If the Committee does agree to recommend that the Scottish Parliament grant consent to the UK Parliament, Members are asked to delegate drafting and publication of a short, factual report to the Convener and the clerk without the need to discuss a draft as part of a future Committee meeting. This would include a decision on how to respond to any points raised by the Subordinate Legislation Committee. This is due to the relatively tight timetable for deliberations before the Bill is expected to reach the last revising stage in the House of Commons. Stephen Imrie Clerk to the Committee 2 EET/S3/10/2/2 Annexe A LEGISLATIVE CONSENT MEMORANDUM UK ENERGY BILL Draft Legislative Consent Motion 1. The draft motion, which will be lodged by the Cabinet Secretary for Finance and Sustainable Growth, is: “That the Parliament agrees that the relevant provisions of the UK Energy Bill introduced in the House of Commons on 19 November 2009 relating to the disbursal of funds for any future Carbon Capture and Storage demonstration projects which will be the subject of assistance schemes (as they relate to environmental issues), so far as these matters fall within the legislative competence of the Scottish Parliament, or alter the executive competence of Scottish Ministers, should be considered by the UK Parliament.” Background 2. This memorandum has been lodged by John Swinney Cabinet Secretary for Finance and Sustainable Growth under Rule 9.B.3.1(a) of the Parliament’s standing orders. The Energy Bill was introduced in the House of Commons on 19 November. More information on the Bill can be found at: http://services.parliament.uk/bills/2009-10/energy.html Content of the Energy Bill 3. The UK Energy Bill will introduce a financial incentive, funded by electricity suppliers, to support up to four Carbon Capture and Storage (CCS) commercial-scale demonstration projects. It is expected that the CCS incentive will be able to provide financial support for future retrofit. This supports our ambition to move to a low carbon economy while maintaining the security and diversity of electricity supplies. 4. The Bill will also include provisions required to implement other policies in relation to refocusing Ofgem’s objectives and creating a mandatory social price support scheme. Whilst neither of these areas will require an LCM, Scottish Government officials will liaise closely with DECC colleagues on the content of these Bill clauses. Provisions Which Relate to Scotland 5. The UK Energy Bill will enable the UK Government to raise a UK wide levy (reserved) on electricity supply to be charged in connection with the provision of financial assistance in respect of CCS demonstration projects. The Bill will include an explicit reference stating that for projects situated in Scotland, the Secretary of State must consult with Scottish Ministers before making, amending or revoking an assistance scheme and before making regulations relating to assistance schemes. 6. In addition to this there are further provisions in the Bill which ensure that the Secretary of State obtains the consent of Scottish Ministers before making Regulations LCM(S3) 12.3 Session 3, 2009 EET/S3/10/2/2 under Part 1 of the Bill which amend or contain provision extending to Scotland.
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